Posted on 07/06/2018 4:39:04 AM PDT by reaganaut1
U.S. Trade Representative Robert Lighthizer is struggling to find a legal national-security rationale to slap 20% tariffs on automotive imports, but we’re told that President Trump has ordered him to find one anyway. There isn’t one. And if Mr. Trump goes ahead and claims there is he’ll be acting as lawlessly as Barack Obama did with his war on fossil fuels.
Mr. Trump in May directed the Commerce Department to investigate whether foreign cars and automotive parts imperil national security under Section 232 of the Trade Expansion Act of 1962. That law allows the President to restrict imports that he determines threaten national security, which is broadly defined as including “the economic welfare of individual domestic industries.” But this grant of authority is not limitless, and the U.S. auto industry is healthier than it has been in decades.
Foreign steel and aluminum also pose no security threat—half of U.S. aluminum imports come from Canada—but at least the Pentagon needs metals for weapons. There is no plausible Section 232 case that foreign cars or car parts are a military threat. About $145 million of U.S. defense dollars in 2016—0.02% of spending—went to auto manufacturers and much of this was for civilian purposes.
The United Auto Workers union argues that the U.S. needs to be prepared for a World War II-style mobilization when auto plants “quickly changed from producing civilian cars to Jeeps, tanks and bombers.” But even if the U.S. did have to ramp up defense production, we have far more manufacturing capacity than during World War II, including 14 more auto-assembly plants. Allies could also assist.
As for the “economic welfare” argument, not even American carmakers support Mr. Trump’s tariffs on foreign cars. Detroit’s trucks and vans are already protected by a 25% tariff.
(Excerpt) Read more at wsj.com ...
That said, I definitely believe that there is something drastically wrong with US-China trade, and that many of our trade deals with other nations are lopsided. How to best address that is the question, and it's complicated.
Regarding US automakers, they got into trouble in the first place, decades ago, by decreasing quality while trying to maximize profits. You can make a good argument that union pressures for wage increases and benefits pushed them to cut corners, but that's too simplistic an answer, and cutting quality cost them dramatically in the marketplace - particularly when cheap and dependable Japanese cars became readily available. Things have changed since then, and the quality of US cars has improved markedly, but it's hard to change public perception once you've lost the confidence of the consumers. Further, the government bailout and playing cozy with the Obama administration has left a very sour taste with a lot of Americans. I personally will not buy any car from GM, and I try to buy American products preferentially.
Is this even accurate?
The answer would seem to be easy — if we ever had to be building tanks again, having more domestic auto plants to do it would be a boon.
That’s it in a nutshell. Unless, of course, we’re happy outsourcing our vehicle needs to our enemies. I’m not.
obama ordered perfectly good cars to be destroyed and used taxpayer money to do so.
I can’t get to the article
“obama ordered perfectly good cars to be destroyed and used taxpayer money to do so.”
Yes that stupid cash for clunkers boondoggle
“Foreign steel and aluminum also pose no security threat—half of U.S. aluminum imports come from Canada”
Does Canada actually produce that aluminum? Or is Canada re-exporting dumped aluminum from China. I believe it is the latter. In which case, it IS a problem.
There are several problems with this reporter’s ‘vision’.
First, perhaps he didn’t notice that...but BMW was in the expansion phase of its Mexico plant, and because of NAFTA...that company (BMW-Mexico) would have a insider seat to the US market. An unfair seat, in my humble opinion.
Second, the quote here “the U.S. auto industry is healthier than it has been in decades”? Well...what evidence really exists for the statement? It sounds good on paper, but is that a valid statement?
Third, the statement on foreign steel and aluminum also posing no security threat? When you pull up imports over the past thirty years....China, India, and around five to seven countries come up with significant numbers than what existed in the 1980s. I can’t say that for France, or a dozen European countries....but I can say it for Germany. The ‘gift’ of dumping cheap steel on the US? And that poses no threat? Sorry, it won’t work.
Then you get to that statement....”we have far more manufacturing capacity than during World War II”. If fair competition were on a continuing trend of eroding....how would the nation continue to maintain that manufacturing capacity?
Then finally, he says something to the affect....that allies could also assist. Well....if they were the ones who advocated unfair competition and helped to make you weak....how would you convince them to assist? Basically, they’d evaluate your request and then say that you would need to meet their conditions or demands....if they were going assist you. I believe that’s the gimmick that has developed in the past thirty years.
Not to dump on these poor journalists for the Wall Street Journal....but I’m just a regularly educated guy who read a good bit, and I’ve got the ‘game’ figured out....it’s a waste of time to write bull**** articles like this. It just won’t work.
“We’re by far the largest supplier to the U.S.,” he said, with annual output of 3.2 million metric tons of aluminum coming from 10 Canadian smelters and 90 percent of that output heading south of the border. Canada supplies about half of U.S. aluminum requirements, according to the Aluminum Association.”
I like to watch an asian TV series to get a glimpse of the country originating the program. There are lots of them on Netflx. I like both Korean and Taiwan programs. Both give a glimpse of the new and the old.
I happened on a cop show that comes from China, mainland China. It portrays a major crimes unit in the fictional city of Ling. One of the cops is fond of jeans and T shirts. One shirt was advertising GANT and had an American flag. Another was noting Statten Island and had the zip codes and other stuff I could n’t read.
Most amazing however are the police cars....... all are Buicks
Anyone in the lower 90-95% of salary earners knows that real earning power of wages has been at best flat for a couple of decades despite oodles of good news about economic growth.
More globalist BS from the WSJ.
The threat lies in the loss of vital industries and the skills necessary to produce war materials... If we really knew who is making most of our hi-tech military equipment it would probably scare the crap out of us..! I'll wager it isn't us...
“if we ever had to be building tanks again, having more domestic auto plants to do it would be a boon.”
American automakers turned out roughly 20,000 tanks annually in WWII. That’s a staggering number. Detroit and the US auto industry were targeted for destruction by the USSR.
In the case of Detroit itself they succeed beyond their wildest dreams.
L
I don’t think they decreased quality at all.
What happened is, they used mass production but not good quality control.
Cars broke down. That’s why dealers almost always have service departments and trained mechanics. And recalls.
What really happened is that by the late 1960—early 1970s, the Japanese, and to some extent the Germans, deployed real quality control practices on the parts, factory line, and post line checking on the new cars, better trained and promoted quality in the line workers, and the rest is history. American manufacturers just didn’t use such measures at that time.
It took a couple of decades, but they caught up.
It’s flat since NAFTA was signed. Go through rural communities in Georgia, Alabama and Texas....unless you got into some construction or oil field work where the job couldn’t be exported...that’s the only grouping that continually saw salaries progress. Some PhD study should be done on non-exportable jobs and how they did better than the rest.
Found it — Jidoka
“Jidoka. A core principle of the Toyota Production System, jidoka can be loosely translated as “automation with a human touch.” It means that when a problem occurs on a production line, a worker is able to stop the process and prevent defective goods from being produced.”
In Detroit in the 1960s, if you as a line worker (say your the guy that mounts and bolts the rear passenger side tire on in the production line) noticed a bolt missing on the wheel hub and stopped the line, you’d be fired.
It wasn’t planned this way by Detroit, but NOBODY stopped the line. It just wasn’t done.
There has not been oodles of news about economic growth. During the Obama years the news about economic growth was about growth in the tenths of a percent. The propaganda effort was maximized to insure the quarterly rate was at least 1% even thoughthe precision was not in the underlying numbers to produce such a rate.
Wages were flat because there was no economic, market based reason for raises beyond merit rases to replace attrition. The $15 an hour effort is to induce wage inflation thatwill increase wages across the board. Many believe that the wage inflation was calculated to kick in as an extension of Obama care to hide or obscure the loss in wages resulting from mandatory insurance
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